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Tip of the Day Negotiate the Selling Price

Negotiate the Selling Price - You have your down payment in place and you know how much you can spend to purchase your new home, but that doesn't mean...

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    Investing Glossary - P

      Pacific Exchange (PX)

      Pacific Exchange (PX) - Pacific Exchange (PX) is a regional stock exchange with a main exchange floor and building with branches in other sectors of the United States. The history began with the founding of the San Francisco Stock and Bond Exchange in late nineteenth Century. It merged with the Los Angeles Oil Exchange to create the Pacific Coast Stock Exchange though each remained a separate entity. In 1999 it became the first United States stock exchange to demutualize and by 2001 the Los Angeles trading floor office closed. It now has incorporated an electronic options system with a trading...

      Paid-in Capital

      Paid-in Capital - Paid-in Capital is the amount of monetary value paid in by the stock investors during the common or preferred stock issuances, including the par value of the shares themselves. Paid-in capital is representative of the funds recently raised by the company or corporation derived from equity and not from ongoing operations. It is a company or corporations balance sheet entry list under stockholder equity, often shown in conjunction with, or alongside the balance sheet entry for additional capital raised. It compares to the capital and the difference between the two values which equal the premium paid by...

      Paid-in Surplus

      Paid-in Surplus - Paid-in Surplus is paid-in capital the amount of monetary value paid by the stock investors during the common or preferred stock issuances, including the par value of the certificates themselves. Paid-in capital is representative of the funds recently raised by the company or corporation derived from equity and not from ongoing operations. It is a company or corporations balance sheet entry list under stockholder equity, often shown in conjunction with, or alongside the balance sheet entry for additional capital raised. It compares to capital and the difference between the two values which equal the premium paid by...

      Paid-up Capital

      Paid-up Capital - Paid-up Capital is the amount in the currency paid by a subscriber or subscribers in payment of a bank stock or stocks when issued. Bank stock is unsubscribed at less than par and the payment is in cash currency. If issued at a premium it is listed paid-up capital in full. The excess over par, if the stock certificate is issued is resolved through the directors and set aside as a rest or a reserve. Funding within the meaning of the expression in the Bank Act, earning a substantial amount over the dividends paid to the current...

      Paired Shares

      Paired Shares - Paired Shares is the stock certificates of two companies under one joint corporation that is sellable as one unit and appears as one certificate. It is the stock certificates of the publicly trading companies merging as one, under one corporate label. The stock certificate for each duel share printed on the identical stock certificate. Companies and the corporations dealing with these extraordinary shares of stock will pay a higher dividend on the quarter, the semi-year, or the annual report cycle. The paired shares of stock certificates do have a quarterly higher yield than if they remained as...

      Pair Off

      Pair Off - Pair Off is the purchasing of stock securities to offset a previously transacted sale from the same stock security. A transaction in stock securities markets, offsetting buy and sell trading and are settled in cash currency, this based on the difference between the processes of the offsetting of the trading. No stock securities trading hands and instead the settlement difference is the calculated trade. The cash currency is wire transferred to the appropriate involved party. The offsetting position transacted the same day of the authentic purchase. Matching trading for the pair off is reduced settlement risk, a...

      Panic Buying

      Panic Buying - Panic Buying is a fast-paced movement of the security purchases accompanied by the high volume and sharp price increase. It is a period of harsh buying, buyers fundamentally or technically do not evaluate because their primary goal is to acquire the stock certificates before the prices go even higher. For example, panic buying occurred on the day following an announcement a president of the United States is not seeking another term in office. A quick increase in buy orders for an investment caused the rising price in stock certificates. This is a result of an overvaluation of...

      Panic Selling

      Panic Selling - Panic Selling is the opposite of panic buying in that a rush of selling in particular with stock securities or stock securities as a whole. Panic selling accompanied by a particularly heavy volume and sharp decline in price to the stock securities as the shareholders and investors scramble to sell off before prices drop any further than they already have. It is generally expedited by the unexpected event or events viewed by stock traders as particularly negative. For example, the uncertainty surrounding the outbreak of serious hostile environment and a cutoff of oil supplies direct from the...

      Paper Profit

      Definition: A profit that occurs when you're still holding the stock that has appreciated in value.  Commonly called "unrealized gain." TeenAnalyst Advice: If your stock doubles without you selling it, you'll have 100% in paper profit.  You don't get to actually call it a gain until you sell it.  Once you sell it, you have to pay taxes on it.Never consider a paper profit a real profit.  Only do so when you sell it.  ...

      Paper Trail

      Paper Trail – It is also referred to as an audit trail. That which is left behind, as the written evidence  of activities, what is left in the wake of transactions, trades, deals and such related investment activities. Trace-ability, of documentation, documents , newspapers, dailies, articles, pieces of data, information, transactions, slips, receipts, accounting, financial tracks, proof, evidence. Leaving behind that which can be pursued, unearthed, indicate, implicated, mark, imprint and lead to. What audits and investigations rely on. It is the written  record, history, or collection of ‘tracks’, or route-markers along the way, personal, professional and corporately, in and...

      Parabolic Indicator

      Parabolic Indicator - Parabolic Indicator sets the trailing price stops for the short and the long situations. It is the stop-and-reversal indicator (SAR). It is more popular for setting the stops than for a direction establisher or a trend. When the trend is shifting upward, it is time to buy. When the trend is shifting downward, it is time to sell. At the beginning of the move, it will provide a greater cushion to pad between the price and the trailing stop. As movement continues, the distance between the price and the indicator will grow smaller. This action causes a...

      Participating Preferred

      Participating Preferred - Participating Preferred is the capital stock certificates which provide a specific dividend paid that is before any dividend paid to the holders of common stock, and which takes precedence over the common stock in the event of the liquidation. This is a form of financing preferred by investors of private equity and venture capital corporations. The participating preferred stock holders get their currency back with interest and the currency distributed with the percentage of common stock shares into a preferred stock. Like common stock certificates it represents a partial ownership in a company or corporation, with shareholders...

      Participating Trust

      Participating Trust - Participating Trust is an investment company or corporation registered with the Securities and Exchange Commission (SEC) with purchases of fixed, unmanaged portfolio of income producing stock securities. It is the selling of stock shares into the trust to stock investors. Similar to a mutual fund in that while a unit investment trust is not managed, capital gains, interest and dividend payments are passed on to the shareholders at regular intervals. The intervals are four times a year or quarterly. If the trust is a continuum of tax-free investment securities then the income from the trust is also...

      Partnership

      Definition: A business structure in which at least two people own and manage the business. TeenAnalyst Advice: Partnerships are easy to set up and that's why they're often preferred for small businesses with multiple owners.  All profits are taxed on the individual partners taxes.The downside is that they aren't very stable organizations.  If a partner dies, it could send the business into disarray.  ...

      Passive Investor

      Passive Investor - Passive Investor is a stock securities investor who lends currency, but does not actively contribute to the management table. A Limited Partnership as in a real estate development project is one example. Passive stock investors deduct investment losses only when and if gains from the stock investment exceed their investment losses. Income earned by a passive investor is subject to the Internal Revenue Service Alternative Minimum Tax, something to keep in mind. It is an individual who invest currency, but does not manage the business or property involved in the venture. This is good to remain in...

      Payable Date

      Payable Date - Payable Date is the specified date established that a stock certificate dividend enumerated into a financial cash payment to the established shareholder in waiting. This is the quarterly cash payment is established by the company, and or corporation on a date of declaration set in the stock charter of the company and or corporation. It is an agreed to date when all dividends and or capital gains paid as payment in full to the standing, or registered holders. The payable date is within two to four days of the date listed on record. The date of payment...

      Payback Period

      Payback Period - Payback Period is financial economics that refers to the period of time for the required return on an investment. It measures how long the pay for itself factor will take. Shorter repay periods are preferable to long waiting periods. The length of time is due to its ease of recognized limitations. It is a financial and economic tool of measurement between occurrences. It is the comparing of an investment period with no explicit criteria for the making of a crucial decision in the realm of finance. It is a specific period of time considered to be a...

      Paying Agent

      Paying Agent - Paying Agent is a registered individual or individuals accepting payments from the issuer of a stock security. It is an individual in the position of distributing payments to the holders of stock security upon the dividend reimbursement, a disbursing agent. A bank institution is the paying agent designated to pay and distribute the dividend, coupon, and principal payments to the stock security holders. It is an authorized agent who is designate to initiate timely dividend payments to the shareholders of record, providing they are registered shareholders. Occasionally, the issuing organization treasure of record is designate as the...

      Payment-in-Kind Security

      Payment-in-Kind Security - Payment-in-Kind Security is a relatively unusual type of security that allows the issuer of record to pay the investor with addition stock shares in lieu of payment in currency as is expected. The payments in the form of stocks and bonds cause cash flow problems for investors who are then obligated to pay the income taxes on the market value of the additional received securities. These securities are the cause of leveraged securities. A preferred stock and bond payment comes in the form of additional stocks and bonds. Payment in securities can hurt investors, but it is...

      Payment Date

      Payment Date The payment date refers to the date when a stock's dividend is due to be paid to the investor. This date is only true for any shareholders who invested in the stock before the predetermined ex-dividend date. This date is important for investors because it is when they capitalize on any gains that their shares have received, which is one of the main reasons for investing in the first place. Those who did not buy their shares before the ex-dividend date will have to wait for the next payment date to receive their money, which makes buying shares...

      Pay to Play

      Pay to Play - Pay to Play is a provision in a company or the corporation's charter documents, inserted as part of a preferred stock financing ability that requires shareholders to actively participate in the stock certificate offerings in order to benefit from certain protections. If the shareholder does not purchase a pro rata share in any offering, the said stockholder loses the benefits of anti-dilution requirements. In a few accounts, the shareholder who did not participate actively has the stocks converted to common share stocks, losing all rights and provisions. The fears of shareholders will benefit by having other...

      PEG Ratio

      PEG Ratio - PEG Ratio is the price earnings to the growth ratio valuation. This is for the determination of the relative trade-off in the price or prices of stocks generated on a per share basis and the company or corporations expected growth pattern. In general the ration is higher for a company or corporation with a high growth rate. This makes the company overvalued in the relation to other like companies or corporations. It assumes the resulting ratio is better for comparing companies with different growth patterns. This is above all, considered to be an estimate rather than a...

      PEGY Ratio

      PEGY Ratio - PEGY Ratio is the variation of the price-to-earnings ratio in that a stock value evaluated in detail by its projected earnings growth rate and dividend yield. For the stocks paying a substantial dividend, the PEGY ratio is a better rule of measure in that it keeps in mind the numbers based on future sales projections. It is a tool to utilize when it is in need, but not a guarantee of accuracy. It is the stocks earning divided by the projected earnings growth rate and dividend yield. It is a representative sample of the growth and projection...

      Penetration Pricing

      Penetration Pricing – This is a market saturation, entry and penetration marketing strategy. It is a very aggressive tactic and highly effective investment strategy, costing model. Diffusion, infiltration, saturation, dissemination, incursion, giving and enabling access, market entrance, invasive methods, structures, where costing is done deliberately to get results. It is done with acumen and shrewdness, understanding and in-depth purpose, to get ahead and into the market, competition. Another pricing technique, policy, that effectively results in setting very low initial prices (entry), for a new or innovation, launch or new product as it goes to market.  Ensuring and capturing the mass...

      Penny Stock

      Definition: The name given to a stock typically trading below $5/share. These stocks typically have low market caps, little liquidity, and are traded on OTC exchanges. TeenAnalyst Advice: Penny stocks are risky for a number of reasons, including? 1.) Small changes in the stock price affect your return greatly. 2.) These stocks usually have less history for investors to go buy. 3.) These stocks usually have bigger spreads in the...

      Penny Stock Reform Act of 1990

      Penny Stock Reform Act of 1990 - In 1990, United States Congress brought into effect this act which was designed to force brokers and penny stock dealers to gather and keep information about any person who wanted to purchase penny stocks. This information was then utilized to determine the possibility of fraud, and allowed the Securities and Exchange Commission, known as the SEC, to be able to determine whether the purchaser was attempting to manipulate the price of penny stocks or otherwise alter the appearance of the value of the stock. This was primarily to protect beginning investors from abuse...

      P/E Ratio

      Definition: The price of the stock divided by the earnings per share.  It's used to determine whether or not a stock is overvalued. TeenAnalyst Advice: People often get caught up in a stock's P/E ratio.  It's not really all that great of a way of measuring a stock's true value.  But it is a good way...

      Percentage Order

      Percentage Order - When an investor is working with an individual or firm that is paid to act on their behalf in the purchasing, trading or selling of stocks (Broker), the investor has the opportunity to request that the broker monitor share trading within certain stocks. The broker is to commence activity only after a certain predetermined percentage of trades of the specified stock has occurred. The percentage is determined by the investor, based on his knowledge or understanding and the broker is then ordered to complete the action of buying or selling when the correct percentage of stocks has...

      Performance-based Compensation

      Performance-based Compensation This is a fee that is given to a hedge fund's general partner as a reward for good performance. When the hedge fund increases in value, the general partner will see this bonus increase considerably. In many cases, this compensation is given out when a certain goal is met and this goal is usually predetermined. In some cases, a mutual fund manager might also see some performance-based compensation, but this also usually occurs when a predetermined level has been attained by that manager. This is used as an incentive for these individuals to perform well on these ventures...

      Performance Fee

      Performance Fee The performance fee is an amount of money that is given to a investment manager as a reward for good making the investor money. This fee is usually a certain percentage of the return that the investor has received from the fund or investment and can be very lucrative for the manager when a great deal of money has been made. Generally, this is meant to give managers the motivation to help an investor's portfolio grow, as this is the only way that investors will see consistent results in the market and a good manager knows how to...

      Period of Digestion

      Period of Digestion - When new stocks or bonds are introduced to the market, they often go through a period of raising and dropping share prices as investors try to determine a reasonable price. The first few public offerings will eventually stabilize the trading price. This volatility is considered a necessary part of the time period required to even out the prices for newly registered and issued securities such as primary shares or other new offerings. This volatile period is referred to as the period of digestion, implying that the market, and specifically investors, needs time to ?digest? the value...

      Perkins Loan

      Definition: Perkins loans are given to students who show that they have financial need (by filling out the FAFSA).  Here are some of the details: Interest: 5% (fixed for the life of the loan) Undergraduate limit: $4,000 per year...

      Permanent Capital

      Permanent Capital - When shares owned by and individual are represented by voting rights relative to those shares the investors have the right to access a company’s assets. These are referred to as “common” shares. Preferred stock is similar to common stock except that a specific dividend is paid to the stockholders before any dividends are paid to common stock holders. When these two types of shares are combined and calculated with the retained earnings (earnings which were re-invested in the business or use to pay off debts) of a given company, the total value is considered permanent capital in...

      Permanent Financing

      Permanent Financing - When a need arises for a company or individual to purchase or develop something that is not expected to be sold in the next fiscal year, such as office furniture or manufacturing equipment, this is called a long term fixed asset. Often short term financing is required to purchase or develop this asset. Once the asset is constructed or obtained, a long term loan or mortgage is used or a bond is issued to repay the short term financing.  The purpose of this kind of financing is to improve the overall equity of a company or individual...

      Permission Marketing

      Permission Marketing -  It is an e-marketing tool, a particular type of consumer-focused and driven, opt-in, consent, authorization go-ahead agreement acquiescence advertising, promotion and selling. It is not intrusive or interruptive, less in-your-face approaches, payment, purchasing decision-making for consumers.  Asking for permission before proceeding with an action is more considerate and highly effective, more-so than hard-handed approaches and pressure-selling. Implicit or explicit permissions  are obtained, opt ins, subscriptions or memberships, for promotional items and pieces. As effective means as any to convert prospects, lead and pre-qualified consumers, into clients.  Permission marketing nuts and bolts include, target marketing and market segmentation...

      Perpetual Warrant

      Perpetual Warrant - When a firm issues a certificate that allows the holder of that certificate the right to purchase its securities at a given price, it is called a warrant. These are generally long term certificates and are not issued by futures exchanges. Most of these warrants will be valid for a specific period of time determined at the time of purchase. In the event that the warrant does not operate within a specified period of time it is referred to as a perpetual warrant. This type of warrant is very practical for enhancing the marketability of a given...

      Who is Peter Lynch?

      Definition: Peter Lynch was the fund manager for the Fidelity Magellan fund from 1978 until 1990. During that time, he achieved an annual return of 29% per year. More Details: Peter Lynch was a great mutual fund manager while at the helm of the Magellan fund.  He also ...

      Phantom Stock Plan

      Phantom Stock Plan - When a company wishes to encourage productivity in its employees, on effective way to accomplish it is to offer the employees a benefit plan that is similar in structure to share in the company without the company having to actually sell the shares. The arrangements and payouts would be similar to a deferred compensation plan, in that the employees would receive benefits if the stock performed well over a certain period of time. The incentive is thereby placed on the employees to do everything they can to help the company profit. The advantage to the employee...

      Philadelphia Stock Exchange

      Philadelphia Stock Exchange - One of the oldest establishments in securities is the Philadelphia stock exchange. Here the shares of stock and common stock equivalents are bought and sold. It began in 1709 and developed into the largest exchange of its kind in the United States. As the economy developed, the Philadelphia exchange merged with the Baltimore Stock Exchange, the Pittsburgh Stock Exchange, and the Washington Stock Exchange. In 2008 the National Association of Securities Dealers Automated Quotations, then referred to as the NASDAQ acquired the Philadelphia stock exchange. The NASDAQ then capitalized on the electronic securities market, allowing brokers...

      Philippine Stock Exchange

      Philippine Stock Exchange - Established when a merger of two stock exchanges (The Manila Stock Exchange and the Makati Stock Exchange) occurred, the Philippine Stock Exchange maintains two trading floors. One is in Makati City's central Business district and the other is at its headquarters in Pasig City. It is the primary stock exchange in the Philippines and one of the major stock exchanges in Southeast Asia. The Philippine Stock Exchange has been in operation since 1927. The company was operated at one time as a non-profit organization but in 2001 after the securities regulation code was enacted, the Philippine...

      Phone Switching

      Phone Switching This give investors the ability to transfer currency between various mutual funds, as long as those funds are part of the same family, on the telephone. This is much easier than heading down to the manger's office in order to get these results, as it can be done in a matter of minutes. By allowing telephone switching, it gives the investor better control of his or her assets, which is a major positive in the long run for all investors. It also allows mutual fund managers to give better customer service, since they can be readily available on...

      Piggyback Registration Rights

      Piggyback Registration Rights - When a Company wishes to make an offering of new securities of stock on the markets the shares are registered in the name of the exact owner with his or her address. When these are sold the new owner must register with name and address. Registered shares allow the issuers to always know who their shareholders are. This avoids the likelihood of unexpected surprises with active investors. In the event that a company that has previously offered share desires to make a new offering, the existing stockholders have the right to register and sell his or...

      Pivot Point

      Pivot Point - The pivot point is the term used to describe a formula used to estimate approximate values for the market price of a given stock. As the price increases with daily trading a hypothetical ?ceiling? is reached where the highest trade values are and a theoretical baseline is established. When the market price exceeds this typical perimeter in either direction it is referred to as the pivot point. If it is above it is considered a new support level while a drop below the pivot point is called a new resistance level. This calculated estimation is often used...

      Point Of Sale

      Point Of Sale  - Also abbreviated as POS, Point-of-purchase, to indicate how, where, when, details, record, transaction, deal, trade, vending, retailing, selling occur, in retail and economic, even web-based buying/selling. The POS, point-of-sale, could be online, at check-out, cashier, register, when money exchanges hands. Payment processing, charges, refunds, discounts, real-time transacting can al be effected as it happens, when require, on-demand, with accuracy and precision, saving money, overhead and giving transparency, data-driven econometrics to make better business decisions. Point of sales, terminals, mobile, handheld, scanners, and input devices for retail contexts and locations, stores, whenever a/any transaction is and executed....

      Poison Pill

      Definition: A poison pill is a way to make a company less attractive to a hostile buyer.  This prevents hostile takeovers and changes in management. Advice: Common types of poison pills include the following: 1.) The right for existing shareholders to buy shares at a discount ...

      Pooled Fund

      Pooled Fund This term simply means that a group of investors have pooled their resources together in order to create a larger investment. In many cases, these investors will have similar assets and wish to give themselves more leverage by pooling together. One of the most common types of a pooled fund is a unit trust, where all of these earnings are held in trust in order to keep things fair for all investors. This can be any type of fund, however, and investors are always coming up with more creative ways to join their assets together and maximize their...

      Portable Alpha

      Portable Alpha - The term portable alpha refers to a management strategy where an investment manager collects together a group of investments together in what is called a portfolio. If the investment manager is particularly skillful, he will use a variety of techniques such as futures, swaps and options or short selling to reduce or eliminate the market risk. If the investment manager successfully manages this portfolio so that the movement of the market does not have a negative effect on his profit he is said to have alpha return as opposed to beta, which would be representative of the...

      Portfolio

      Definition: All of your investments.  If you own five stocks, a bond, and have bank CD's, those would be collectively referred to as your portfolio. TeenAnalyst Advice: When you hear a person talking about their portfolio, they're just referring to all of their investments.  If they say their portfolio is up 12%, it means the average return for all of their investments has been 12%.  ...

      Portfolio Beta Score

      Portfolio Beta Score - The beta score is a term used to describe the calculation of the volatility of a given portfolio. The portfolio is the collection of securities that an individual manager has put together in the hopes of making a good profit (return). A skilled manager will select them in such a way as to balance the potential for growth against the risk of drop in value. Selecting a wide variety allow the manager to offer a degree of comfort to his clients. The score is base on the relative overall performance of the specific portfolio relative to...

      Portfolio Management

      Portfolio Management The act of managing the mutual funds and other assets of an investor. This also includes making sure that the best possible investments are being made and that the overall performance of these investments reaches an acceptable level. In many cases, this will also call for investments to be altered in order to maximize profits, so this portfolio management is very important for investors. Good management is often rewarded in the form of a significant bonus, so this profession is highly performance based. There are many aspects that an investor will not want to handle on his or...

      Portfolio Manager

      Portfolio Manager This is the person who is in control of portfolio management and is, therefore responsible for controlling the assets of an investor's mutual fund. It is the responsibly of this manager to constantly monitor these investments in order to ensure that everything runs smoothly. In addition, this manager must distribute funds into favorable investments, so that the investor's return will be maximized. When a portfolio manager is right about an investment, he or she is usually given a large bonus. If he or she is wrong, however, the investor will lose a great deal of money and the...

      Portfolio Separation Theorem

      Portfolio Separation Theorem - This is the term used to describe the practice of separating the decision about the type of stock to invest in, from the decision about the acceptable level of risk. The personal preferences of an investor will not affect the overall risks involved in diversified portfolio. The investor makes his decision based on the present value of the projected returns. This behavior allows investors the freedom to include a company in their portfolio regardless of that company's choice of debt to equity ratio, and allows the clients the benefit of the improved potential for profit. It...

      Position Building

      Position Building - Position building is a process in which an investor is working on a long position when buying shares. If he buys large portions, he is building a long position. When he sells he wants to maintain a short position. The interest of an investor is measured by this position building; people use the term gauging for it. Gauging is also used in knitting; in the investment industry it is used typically when analysts analyze the interest of an investor in a company, by watching the position that he builds on the market for a certain amount of...

      Post-Money Valuation

      Post-money valuation - Post-money valuation is the value that a company has, after the latest round of funding. It means that an investment has been made. The new value of the company equals the sum of the value of the company before the made investment, plus the amount of new equity. It is also calculated this way: the value of the company equals the number of outstanding shares, times the share price from the latest round of financing. This is especially interesting to venture capitalists and so called angel investors, when they are planning a cash injection in a company....

      Producer Price Index (PPI)

      Definition: An index that measures changes in price from the perspective of the seller.Advice: The PPI measures changes in price based on three areas of production: industry, commodity, and stage of processing.  This index differs from the CPI, which measures changes in price from the perspective of the buyer.This is a closely watched indicator because it hints at the level of inflation in an economy.    ...

      Prague Stock Exchange

      Prague Stock Exchange - The Prague Stock Exchange is the place where financial trades are made in the Czech Republic. Its first exchange opened in 1861; the present Stock Exchange was established in 1992. Only members are allowed to trade on this exchange; usually they are licensed security traders. In September 2008 the Warsaw Stock Exchange tried to take over the Prague Stock Exchange, but they did not succeed. The Vienna Stock Exchange however became a majority stakeholder of the Prague Stock Exchange. When the Czech Republic will accept the Euro as their currency, the trading in Czech Koruna will...

      Pre-Money Valuation

      Pre-money valuation - Pre-money valuation is a term, used to valuate a company before an investment is made. The valuation before a money injection is usually calculated in the assets that a company has standing out, and the value that they represent. Venture capitalists and angel investors use this to calculate how much equity to ask for their money injection. Equity is another word for share of stock, which represents a certain part of ownership in the company. Usually investors make investmens to gain profit on short or long term. For the company in question money injections often are essential...

      Pre-Sold Issue

      Pre-sold issue - An issue of securities that is sold, before the details of the new issue are released to the market. The issue can be offered for sale by a company or by the government. In the case of a company for instance, preferred stock owners can be invited to buy more stock, before others have the opportunity to buy stock. In that case a company is able to get the funds they need in a quicker way. The stock market is not involved in a pre-sold issue; as the issue already has been sold. It might even save...

      Pre-Syndicate Bid

      Pre-syndicate bid - A bid on stock that is entered before the effective date of a secondary offering. It is made to stabilize the price during distribution of this block of stock. The effective date of stock, after registration at the Securities and Exchange Commission usually is 20 days. A secondary offering is a registered offer of a large block of stock by a current shareholder. The proceeds of this offering will go to the shareholder, not to the company, and the number of shares will stay the same. Stabile prices always has a good effect on the company's value....

      Preemptive Rights

      Preemptive rights - Preemptive rights are rights that common share holders have, in order to maintain their fraction of ownership of the company. They have the right to buy a proportional portion of a future issue of common stock. These rights are considered valid by most states when they are issued in a corporation's charter. A charter is a document which contains details about the corporation, as well as the rights of the shareholders. These rights are called subscription rights, or subscription privileges. This only counts for current shareholders, new shareholder don't have preemptive rights when they buy stock for...

      Preference Shares

      Preference Shares - A higher ranked common stock. Usually preference shares do not have voting rights. However, when a company decides to pay out dividend, preference shares are paid before common shareholders are paid. Preference shares are also carrying an option to be changed into common stock. In case when a company faces bankruptcy, holders of preference shares are paid in assets of the company after the debt holders, and before the common share holders. Often preface shares are carrying a par value... the dividend is usually a percentage of this par value, or a fixed value. Often dividend rights...

      Preferred Equity

      Preferred Equity - Preferred equity is a measure of ownership interest in a corporation which only counts the preferred stock. Preferred Equity is equal to shareholder's equity (in total) minus common equity. Preferred equity shareholders usually receive their dividend before common equity holders. When a company is going bankrupt, preferred equity holders will be paid before common equity holders, but after the debt holders. Companies usually try to pay out par value of each equity. Preferred equity owners usually carry no voting rights. Other special rights to preferred equity may be issued by the board of directors of a company....

      Preferred Shares

      Preferred Shares - Preferred Shares are shares which provides a specific dividend. It is paid before the common share holders get paid. Preferred shares take precedent over common shares in the event of a liquidation. These shares represent part of an ownership of a company. Preferred shareholders do not enjoy voting rights, like common stock holders do. Preferred shares pay a fixed dividend, although the company does not have to pay dividend when it lacks the financial ability to pay. Still, in regard to common share holders, preferred share holders get their dividend before common share holders do. Investors with...

      Preferred Stock

      Definition: A class of stock that usually pays a higher dividend than the common stock.  However, preferred stock is less liquid and usually doesn't have voting rights. TeenAnalyst Advice: People usually buy preferred stocks to take advantage of their dividends.  Many preferred stocks pay dividends of 6% or more.  These ...

      Premium over Conversion Value

      Premium over Conversion Value - The premium over conversion value is the positive difference between the market price of a convertible security, and the price at which it is convertible. Convertible security can be bonds, preferred stock or debentures. These can be changeable at the option of the holder. They can be changed into common stock of a company. The market price can be higher than the convertible price... the option holder has less to pay for their common stock in that case, and can sell for the market price, which will give him instant profit at the transferred stock....

      Price Leadership

      Price Leadership – Whenever a key market leader takes and set the tone, pace and price, markets are left to catch up, competitors having to lower, adjust, raise their prices accordingly in the name of competition. Then markets (and pricing), will shift, move and respond. Such management, control, direction and guidance of things like innovative, competitive and accurate price leadership, can be useful and good criteria. Pioneering costing, valuation, fees structures, charges, penalties, costs, consequences, setting prices, rates, assessments and estimates matter, as they change, shape and effect markets. Looking for these cues and clues in the marketplace and from...

      Price Risk

      Price Risk - The market price of stock can go up and down. A price risk is a risk coming from the possibility that the price of stock or physical commodities declines (goes down) The investment is worth less than what is paid for in the first place. Commodities are used by contract buyers, bought upon contract on spot markets or future markets. These commodities are also market-sensitive and the price can go up or down here as well. The risk to lose money on stock is mostly temporarily but when stock prices in general are going down, the financial...

      Price Support

      Price Support- Plain and simply defined by most online dictionaries and glossaries, industry public domain docs, as that lower/lowest (minimum) government-set price for product, asset, goods, services, with back up and assistance through payments to producers when market price dip below that set parameter. Data, back-up evidence, hold-up, bearing, sustainable, buoyancy props and foundations, reinforcement, confirmations and verifications, evidence backing provision, defence of/for costing, fees, pricing, valuation, worth-assessments work together as pricing technique for market stability and ultimate results. Government subsidy or actions, taken in order to keep up the prices at a pre-set, specified level. Economics of  price control,...

      Price To Book Ratio

      Price to book ratio - The result of the following: the financial value of stock, divided by the book value. The result will be the same if it is calculated for the whole company, or if calculated per share. The ratio will compare the market's value of a company with the value that the company has indicated in its financial statements. Is the market ratio higher, the higher will be the premium that the market is willing to pay for the company's stock. Is the ratio low, the company may prove to be a good investment opportunity. This does not...

      Price To Cash Flow Ratio

      Price to cash flow ratio: The capitalized value of stock, divided by the cash flow of the company. This is calculated over a fiscal book year. It does not matter if the results are calculated over the entire company, or per share; the result should be the same. The cash flow shows how healthy a company is, in a financial way. A fiscal year however does not have to start on Jan 1st, but can start anywhere in a year, for the duration of 12 months. It might be more convenient for a company to have their fiscal year start...

      Price to Earnings Ratio

      Price to Earnings Ratio - The price to earnings ratio is the most common measure to determine how expensive stock is. It is usually calculated over a period of 12 months. The Price to earnings is the result of the capitalized value of stock, deducted by the earnings minus taxes over these earnings You can calculate it over 3 periods of time; the trailing period, the current and the forward period. The ratio's over the current and forward period are usually estimated ratios, the ratio over the trailing period is a current one. Usually the price to earnings ratio over...

      Price to Sales Ratio

      Price to Sales ratio - This ratio is used for unprofitable companies, which don't have a price to earnings ratio. The price to sales ratio is the capitalized value of stock, divided by the sales of stock in the past 12 months. The calculated value is the same if the calculation is made per share or for the entire value of the company. A low price to sales ratio is usually a sign to investors that the investment is a good one, but the price to sales ratio does not show the entire picture of the state that a company...

      Price Transparency

      Price Transparency - Price transparency is the degree to which information about trading of stocks is available. Stock indexes are the trading firms, providing this information. If the transparency is high, the public can see the range of bid and ask prices for each stock. If the transparency is low, the public does not have access to this information. The Nasdaq (level II) service has a high transparency, the New York Stock Exchange has a low transparency and they show only the highest bids and lowest amounts of stock traded. Price transparency is however a tool to get the general...

      Primary Distribution

      Primary distribution - Primary distribution is the original sale of stock, from company to the shareholders. The proceeds of the sale of stock goes directly to the company. It is opposite to secondary distribution, as the shareholder in that case offers stock for sale and the proceedings of that sale will go directly to the shareholder. The primary distribution is usually effecting the financial status of a company in order to make investments in their products possible. Governments work with primary distributions too, in order to get funds beside taxes, to invest into the country, or to create a better...

      Primary Instrument

      Primary Instrument This is similar to a financial instrument, except for its value does not come from another instrument, but rather directly from the market. For example, a cash instrument is a primary instrument, since it is able to be transferred at all times. In addition, things like monetary loans are primary instruments because a transfer and its terms have already been agreed on. This is the opposite of a derivative instrument, as these are controlled by the value of other assets, rather than themselves. The value of cash is not dependent on anything but itself, so it is a...

      Primary Offering

      Primary Offering - Primary offering is the first sale of stock by a company to investors. The earnings made by selling this stock goes directly to the company. It is opposite to secondary distribution, as the shareholder in that case offers stock for sale and the proceedings of that sale will go directly to the shareholder. The primary offering is usually effecting the financial status of a company in order to make investments in their products possible. Governments work with primary offerings too, in order to get funds beside taxes, to invest into the country, or to create a better...

      Prime Rate Fund

      Prime Rate Fund A prime rate fund is a type of mutual fund that makes an attempt at getting the same return as the current prime rate. This is accomplished by investing in corporate debt that is likely to have a return on it. Since the prime rate is not available to all customers, and is generally reserved for these multinational corporations, there is a good chance of receiving a return. In addition, prime rate loans are given out because there is not a very good chance of a default, which can also lead to a sure return for investors...

      Principal Shareholder

      Principal Shareholder - A principal shareholder is someone ( an organization or a group is also possible) who owns 10 percent or more of the outstanding stock of a company. Outstanding stock is mostly common stock that has been sold to the shareholders. Shareholders can be individuals, organizations or groups who own one or more shares of a company. Usually a company has a group of shareholders, but it is also legal to have just one shareholder. If a company has one shareholder, technically this shareholder is a principal shareholder. (as he owns more than 10 percent of the shares.)...

      Prior Preferred Stock

      Prior Preferred Stock - Prior preferred stock is preferred stock which has a higher claim than regular preferred stock, from the same company. The rights on prior preferred stock are usually on dividend (prior preferred stock gets paid before preferred stock and before common stock) and in case a firm goes bankrupt they get paid in assets before preferred stock holders and common stock holders, but after the debitors. Preferred stock is common in private or pre-public companies. Government rules and the rules of stock exchanges may discourage or encourage trading of preferred stock. In the United States two kinds...

      Private Company

      Private Company - A company that does not sell shares on the open market. It is the opposite of public company - a public company does sell their shares on the open market. Usually private companies divide their shares among family members or workers who have earned their merits in the company. This kind of ownership is called private. Still private companies are important to the economy of a country. Private companies are usually called corporations or limited corporations. In the US, private companies are not required to publish their financial statements, opposed to public companies. There is a limit...

      Private Equity Fund

      Private Equity Fund This type of fund focuses on private equity when making an investment. The end goal is to gain control over the company that has been invested in and eventually to restructure the company. Once the company has been taken over, it is usually privatized in order for this restructuring to take place. Once the company is feasible again, it is re-listed on the market and the investors can begin making money on their investment. A private equity fund can be a risky investment because you never know how well a company will bounce back, but experienced...

      Private Investment in Public Equity

      Private Investment in Public Equity - This is a transaction in which investors are allowed to purchase stock in a public company. The investors should be accredited. That means that they have to meet the acquirements that the Stock Exchange Committee formed for this group of investors. For individuals it means that they must have a million worth in finances or assets before making a private investment in public equity. The price they pay for this stock is below the market price. The stock is registered at the Stock Exchange Committee, so later the stock can be sold to the...

      Private Placement

      Private Placement When securities are sold to a bank, mutual fund, foundation, pension fund, any type of insurance company, or any other institutional investor. This purchase must be classified as being an investment, rather than buying it in order to make a resale. Also, since this type of sale does not need SEC registration, the investor does not have to disclose any of the securities' financial information. By privatizing the ownership of the company, many different avenues can be taken in order for the new owner to maximize the profits of the security, without having to worry about outside sources...

      Proceeds Sale

      Proceeds Sale - A proceeds sale: A securities transaction, made by members of the NASD, that uses any funds from the sale of securities - the funds are reinvested in other securities. Simply said: You sell securities and with the earnings of this trade you buy new (other) securities. Money is in this way re-invested in new stock. These proceed sales are considered transactions by the National Association of Securities Dealers (NASD). In 2007 the NASD has formed the Financial Industry Regulatory Authority (Finra). Members using proceed sale transactions must abide the 5% guideline. This guideline prevents commission or markups...

      Profit and Loss Statement

      Profit and Loss Statement - A profit and loss statement is a quarterly or annual document, published by a public company. It shows the earnings, expenses and net profits. Net profit is calculated by subtracting the expenses from the earnings. The result is what the company has earned, or lost, in a given time frame ( quarter or year). Together with the balance sheet, the profit and lost statement are the most important financial reports that a public company has to publish. The profit and loss statement shows transactions over a given time period, the balance sheet gives insight...

      Profit Margin

      Definition: The percent of sales that result in profits.  They can either be talked about in "gross margins" or "net margins." TeenAnalyst Advice: This would be the percentage of profits a company receives for their revenues.  For example, if I sold candy for $1.00 and it cost me $0.20 to make that candy, I would have $0.80 of profit.  My profit margin would be 80%.A gross margin refers to sales minus cost of goods sold.A net margin refers to sales minus cost of goods sold minus expenses.   ...

      Profit Motive

      Profit Motive – It is also known as maximization and pursued as a course in and of itself.  Benefit, outcome investment results orientation, like zooming in on ROI what matters and makes a difference, its real purpose and intention. Income, earnings, revenue, proceeds, turnover, return, yield, takings, gains, rewards, not losses, risk, take the center-stage and spotlight with this type of approach, profile, investment risk-tolerance and strategy . The focus undeniably falls on what brings in and makes money, or would be an advantage to the bottom line  Pure focus on the benefit and gain, the good, positive, reward, its...

      Proof Of Concept

      Proof Of Concept – (Proof-of-concept) Referring to the types and applicability, reliability or evidence, verification, confirmation and corroboration, even substantiation, or resilience of data, fact etc. Also called POC, showing its usefulness and applications, features and possibilities, allowing to an extent no to low risk exposure and exploration, prospecting if you will PRIOR to investing or opting for it.  That an idea, notion, thought, impression, perception, theory, model, hypothesis, view or belief pans out, is, will be real, rewarding and trustworthy. A quick-trial of sorts. It can be used and called on for demonstrating feasibility, applicability, even as a partial...

      Proportional Representation

      Proportional Representation - Proportional representation is a method of voting for shareholders, on which one is not required to vote for a different candidate, for each seat in the board of directors. They can give multiple votes to one candidate. You can compare it with voting in a party system; the people with the highest number of votes get the seat in the parliament or senate., reflecting the voting of the people. This way of voting is considered more democratic. The board of directors is usually paid in assets or cash, and they are assumed legally responsible for corporate activities....

      Prospectus

      Definition: An informational booklet that a mutual fund offers to investors.  You can use the prospectus to decide whether or not to invest in the mutual fund. TeenAnalyst Advice: A prospectus is legally required by the SEC for all mutual funds.  In the prospectus, you'll find info about the fund such as its holdings, its expense ratios, etc.You can request a prospectus online from most mutual fund companies.   ...

      Provisional Call Feature

      Provisional Call Feature - A provisional call feature is a feature, in a convertible issue, to call the issue if the stock reaches a certain price level. This provisional call feature is of benefit to the issuer, as well as to the investor. Then at that price convertible stock is traded for common stock. A convertible issue is stock or bond that can be exchanged for another kind of stock (preferred stock can be exchanged for common stock for example). The issuer can be a company, investment trust or municipality (elected local government), offering securities to be sold to investors....

      Proxy Statement

      Proxy Statement - A proxy statement is a document which the Stock Exchange Committee requires a company to send to their shareholders. This document provides facts concerning matters on which shareholders have to vote. It also shows how management is paid, It also shows potential conflict-of-interest issues. It also includes: information and voting procedures, background information about the nominated directors and the compensation they might get, information about the executive compensation and a breakdown of audit and non-audit fees, paid to the auditor. This statement has to be sent in advance of the shareholders annual meeting, according to the SEC....

      Proxy Vote

      Proxy Vote - Members who are actively up to date are given an opportunity to participate in the decision making process. This is inclusive with active members to approve or, reject the subject material at hand. Members involved in the election of officers through other elected members to cast a vote. This would apply mostly to stockholders within a given company who are not planning to physically appear to cast their vote. When you purchase stock in a company through a participating broker, he will mail a form for you to fill out, mark your vote choice, and, return it...

      Public Company

      Definition: A company that investors can buy and sell shares of on the open market.  As opposed to a private company, in which they can't. TeenAnalyst Advice: A company "goes public" when it issues stock for the first time.  This represents the first time regular investors can buy or sell shares openly.A private company is much harder to invest in.  Not everyone can do it and it's usually at the discretion of management.The downside to being a public company is that the company must report more information.  They're also liable to shareholders and must look out for their interests.  If shareholders...

      Public Employee

      Public Employee – Being state-employed, working for the government, mainly community, civic, municipal, unrestricted agent, workers, staff members, active in the public domain. Those working for the people, on the behalf of, for the interest of the general populace, as, for and through the government, agencies, in the open, not in secret, behind closed doors, broadcast and known, in the public eye so to speak.  An individual or groupings of persons employed part or full-time, under contract and agreement, working for government, municipal, county, state, or federal employers, including state-tertiary educational entities (colleges, universities)  A full-time member, officer or employee...

      Public Equity

      Public Equity - Public equity is the involvement of private investment into public equity, referred to most often as a PIPE (Public Investment Private Equity). It consists of the selling of publicly traded common shares of stock. It is what privately secured investors know as preferred stock. A potential investor has the opportunity to purchase shares of stock or, equity linked securities at a lower than normal price therefore, saving the investor money. It provides a potential investor the opportunity to acquire a substantial position at a fixed price instead of pushing the price of stock higher through the open...

      Public Float

      Public Float - A Public float are those stock shares being set aside from the in house stockholders for the sole purpose of public consumption at the single discretion of the publicly trading company. They are outstanding shares of stock placed for offering through the buying and, selling of stocks into the hands of the public investor. This in turn reduces the amount of stock purchased and, held by directors, controlling interest investors and, company officers. The immediate structure of in house capital is changed and, is now be left with less liquidity than it had before the offering...

      Publicly-Traded Fund

      Publicly-Traded Fund Is different from a mutual fund because it does not redeem shares in the same manner. There are always a predetermined number of shares that are outstanding, so it will act similar to a stock. There is a public offering of the shares of the fund and after this original period, the shares are free to be sold on the stock exchange. Also, the cost of the shares of the publicly-traded are fund are determined entirely by their market demand, which makes it possible to sell shares for a premium when the demand is high. This is also...

      Publicly Held

      Publicly Held - Publicly held is a term used to refer to the stock securities offered out for public consumption. An individual investor or, another interested company or companies can freely purchase securities in a given institution that has made the decision to open up to the mass public domain. These particular securities that have been set aside are freely transferable among various investors at any given time. Stock owned and, ultimately offered publicly is registered stock as opposed to unregistered stock which, is in possession of the institution's founder. This simple re-direction transforms a privately traded company into a...

      Publicly Traded

      Publicly Traded - Publicly traded refers most often to the companies whose shares of stock traded in an organized stock exchange. This is conducted by many companies for the sole purpose of gaining access to increase capital. In this way a given company will have a better standing due to cash, not necessarily in cash the flow but in outside investment. This in turn creates a wealth of increased bargaining power for the company or companies that have invested in the short term. However this is not as secure as it may seem to be because as stock assets increase...

      Public Ownership

      Public Ownership - Public ownership is the government ownership of land, streets, utilities, public buildings and, some other various business enterprises. Though this is a very ancient concept it has evolved partly into the premise of eminent domain. For the good of any given community the government can step in and, retrieve private land for the betterment of public consumption. Within the borders of the United States, government entities own, operate and, have taken over the management of the public school system, highways, bridges, overseers of the utility companies as well as other entities for the betterment of the population...

      Pump and Dump

      Pump and Dump - Pump and, dump is the intentional inflating of stock in either a bogus product or one that in no way lives up to the expectation. Coercing individuals and, other corporations to invest drives the stock price higher and, higher. Ultimately when this particular type of stock reaches a certain plateau the mechanics fall into place to sell and, sell big by a few individuals, at a stretch bordering on insider trading. As the build up or, increase of stock soars, the triggers put into place now sell, leaving many of those who unknowingly invested high and,...

      Purchase Fund

      Purchase Fund This type of fund can only be used when the issuers are purchasing securities that are below the dollar amount that they had originally been assigned. Basically, the issuer is required to purchase a predetermined number of shares is the price of the share drops below a certain monetary value for a specified price. This is meant to protect investors from their shares falling too low because the company has to give the investor the predetermined amount to repurchase the share. A purchase fund is beneficial to the investor and can cause the company problems if their shares...

      Purchasing Power

      Purchasing Power – This refers to the strength and buying muscle, ability and resources, (as measured by quantity/quality  of products/services it can afford/buy. Where the real buying strengths, resources, control and command, ability, agility and procurement lie for and in the business. What is the ability to buy, pay for, acquiring, getting, assets, goods and levering firm footing surface and work best. Metric and indicator of financial success, stability and depth, indicator of the business’ wellbeing and prosperity, earnings capability. The metric, or measure of money-worthiness, value that can be purchased, bought and afforded, despite inflation that decreases purchasing power;...

      Pure Competition

      Pure Competition – This is a theoretical construct and concept. Opposite of pure monopoly, where market-driven, rivalry, contest rules supreme, not dominated by one or key player, brand, stock, provider. Also called perfect competition. If it comes to microeconomics, with small firms with similar goods, products and services, resources allocation, efficiencies and productivity are balanced and successfully profitable, making money.  This is a typical situation where many sellers sell the same product and no seller can set the price. As a wholesome market structure, there are typically similar/identical products, all players not makers, but price takers, with smaller shared market...

      Pure Index Fund

      Pure Index Fund When your portfolio is managed to the point where it perfectly matches how the overall market is performing, it is called a pure index fund. Since this is an actively managed fund, it is more expensive to manage, but the result could end up being better if it is managed properly. Nothing is automatic with this type of portfolio, as a portfolio manager is always involved with the decision making process. This type of portfolio makes it very difficult to miss any problems, but it is really only worth it for those who are investing large quantities...

      Pure No-Load Fund

      Pure No-Load Fund A mutual fund that does not include a redemption charge or 12b-1 fee, so there is no cost whatsoever to enter the fund. The beauty of this type of fund is that every penny that you invest will actually be invested, as it will not be used to cover all of these extra expenses that will often arise. The only drawback is that you will often pay a significant commission. Therefore, while there is no additional money being paid upfront, you will pay in the end if your investment is successful because of the commission that goes...

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      Definition of the Day Market Neutral

      Definition: Market neutral investing attempts to remove the market risk from their portfolios by being both long and short in...

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